Blockchain technology is still quite new. However, it has already penetrated a wide range of industries on a global level. It can potentially change the way any digital data is processed in the nearest future. As per the top blockchain development companies, this technology can solve some most complicated problems the world is dealing with right now. In this article, you will get an overview of the top ten issues blockchain can deal with.
1. Data Storage
The times when knowledge was available only to the chosen ones are long gone. In the digital age, it is much harder to cut yourself off the non-stop information stream than getting the information you need. With the emergence of Facebook, the development of artificial intelligence and machine learning, the amount of information that needs to be stored is continuously growing.
Big Data challenges the capacities of modern data centers significantly. As the technologies mentioned above develop further, the data storage situation gets tougher. IDC predicts that the world will have 163 zettabytes of data to store by 2025. Current cloud storage services do not have the potential to deal with such vast amounts of information effectively.
Blockchain can potentially solve the data storage issue thanks to its decentralized and distributed nature. To store the data in the blockchain, one will need to break it in small parts. Every part will be encrypted and uploaded to the blockchain. Next, the data will be distributed in a way that will allow accessing all of it even in case a part of a network does not function. Such data handling can serve as a much better alternative to cloud storage.
2. Data Security
Storing data in blockchain will bring vast improvement to data security. Currently, the cloud data is stored in centralized storage units, which makes it sensitive to any security breach. Blockchain can enhance the safety and speed of cloud storage. The data, stored in the blockchain, will be stored across the nod network. There will be no need to rely on a central entity or location in this case. Any data attack will not be potentially fatal in the blockchain storage. There will be no way to tamper or steal the data, stored in the blockchain.
Storing data in the blockchain will secure it from force-major circumstances that damage and destroy centralized databases at present (e.g., natural disasters, riots, political escalation). A distributed blockchain data storage network will store redundant copies of data among different nodes so that there is no data downtime and loss no matter what. Blockchain has the potential to store, process, and manage data without the need to rely on any third party.
Currently, most of the payments in nearly every industry are made via a third-party financial institution. Blockchain payments can improve the efficiency of payment procedures for many businesses. For example, when a company enables a blockchain-based payment processor, it will get rid of the payment delays and the time-consuming procedures of the outdated payment system. With blockchain, instant, secure transactions can be an affordable alternative for many businesses.
The structure of blockchain enables a real-time audit for all the transactions, securing them from any modifications. It can potentially enhance the operation of many compliance-intensive industries. Businesses can use smart contracts (applications that run precisely as programmed without allowing any third-party intervention, fraud or downtime) to establish unbreakable regulations for their financial transactions.
For instance, Slock, an IoT platform that works with Ethereum, uses smart contracts software for a bike rental service. When both parties agree on the terms of the contract, a smart lock unlocks on the bike, and a user can ride it.
Conventional financial transactions are impossible without intermediaries like banks. Banks are middlemen that make sure that the money you transfer will get to the predetermined recipient. However, banks do not show you how the transactions happen, and after you hand the money to the bank, all you can do is wait until the recipient receives it. Blockchain gives you an opportunity to trust your finances to secure technology instead of banks.
With blockchain, it is possible to avoid middlemen in many cases. One can send their digital payments from their virtual wallet to a recipient’s virtual wallet with the help of a set of digital keys. To perform such a transaction, one needs to know a public address of a recipient’s Bitcoin wallet. Such transactions are quick, secure and irreversible, which makes them more advanced than habitual bank transfers.
What’s more, blockchain transaction fees are currently much lower than bank fees. Even in cases when intermediaries are needed, holding transactions via blockchain will help businesses and individuals eliminate fraud and secure all the transactions.
5. Supply Chains
Nowadays, supply and logistics chain management is extremely complex. Some products undergo dozens or even hundreds of steps in their supply chain journey. Processing all the invoices, payments, logistics and tax documents take a lot of time and resources. Because of this, the supply of some products can stretch to months and even years. Somewhere along the process, errors, fraud, and force-major circumstances can lead to high losses. Long supply chains can lead to more potential losses for all the sides of the deal.
Blockchain technology is seen as one of the most promising technologies for supply-chain management. It can improve assets recording, tracking, assigning, linking and sharing greatly. Blockchain can facilitate the efficiency of supply chains significantly because it offers excellent security and transparency of the transactions. Blockchain can help document the supply chain journey of every product for better protection and transparency of every step.
Blockchain can replace traditional trade processes and transform trade procedures. As a result, it can increase trade volumes and transform the global economy. With the help of blockchain, illegal and unethical practices can be eliminated from the supply chains on the worldwide level.
6. Intellectual Property
Owners of intellectual property all over the world find it hard to protect their rights in the digital age. It seems like almost any work of art can be stolen, copied and distributed by pirates. However, some companies have already found a solution to this issue with the help of blockchain technology.
For example, Binded created a website that helps artists protect their original images by saving them to the blockchain. This way, an artist receives a certificate that proves that the picture is authentic. However, such a certificate is not a substitute for a certificate at the US copyright office. If an artist wants to win any statutory damages in a lawsuit within the US, they would still need to comply with the formalities.
Speaking of any forms of intellectual property, be it an invention, a trade secret, or a song you’ve written, blockchain can help secure it from theft. With blockchain, one can create a digital trail of records of their innovation process. One can quickly obtain blockchain certificates to prove their ownership over the existence and integrity of an IP asset they own.
7. Government Operations
Unfortunately, there is no perfect government in the world, that is a hundred percent faultless, corruption-free, and just. The adoption of blockchain technology can help to facilitate the delivery of public and government services greatly. The major pain points that blockchain can deal with are elections, identity management, and taxes.
Currently, the standards of identity management are different across the world. It makes the identification process long, inconvenient and vulnerable. A combination of biometric technology and blockchain can replace the outdated identity management system. It will make participating in elections, receiving government benefits, and traveling a lot easier.
Blockchain can make the taxation systems more efficient by automatically checking tax records for fraud. Currently, the US government loses millions of dollars to tax fraud annually. By implementing blockchain solutions, the government will make sure that no tax record can be hacked and changed.
Current social funding and charity model does not have credibility among the majority of people. Millions of dollars get wasted on ineffective projects in social funding. Little transparency makes more and more people suspicions about the reliability of different charities. What’s more, some useful social projects never get to scale because they struggle to get enough visibility. Blockchain can be the answer the sector is looking for.
Blockchain can transform the charity sector significantly. First of all, it can boost the trust of the population by making the donations transparent. Next, it can reduce the transaction costs and other expenses for all sides of the deal. What’s more, blockchain technology can reduce administration costs by checking most of the processes and approving transactions automatically.
For example, Alice is a platform that brings transparency to social funding through blockchain technology. This project incentivizes social organizations to run their projects transparently and make the performance of each of their projects available for the general audience.
One of the greatest issues for many countries is the justice of elections. There are many cases of voting machine hacks, voting miscounts and forced voting. A blockchain-based voting system has the potential to eliminate all these issues. When a vote is saved in the blockchain, it can be tracked in real time, and it can never be changed. This technology can eliminate the possibility of tampering any election. This way, election winners can be determined most effectively.
One more issue of elections is voter anonymity. By enabling blockchain-based voting solutions, the government will protect the anonymity of the voter with the transparent crypto algorithms. Complex mathematical algorithms will encrypt every vote and save it to the blockchain, without leaving a chance to change it or hack it. With blockchain, only citizens who are legally allowed to vote will be able to fulfill their civic duty.
Colombia has already made the first steps by launching a blockchain-powered voting platform Plebiscito Digital. This service has previously worked with the civil society organizations to give Colombian citizens living abroad an opportunity to vote remotely using the blockchain-powered service.
A traditional crowdfunding model leaves much to be desired. It is slowly improving, but there are still significant issues it cannot overcome. With platforms like Kickstarter, Crowdfunder, and Indiegogo, startup projects all over the world received visibility they dreamt of. However, over three-fourths of all the projects do not reach their target goals. What’s more, less than two percent of the raised funds go to the countries with the developing economy. It all means that the current crowdfunding model needs to be changed in the nearest future.
Blockchain can make the funding processes accessible from anywhere around the world, transparent, and highly secure. With this technology, the success of the project can be maximized. What’s more, blockchain-powered crowdfunding can be more democratic, as it will be anonymous, secure, and free of borders. Blockchain can boost the creation of a global crowdfunding tool that can be accessed by anyone around the world easily. It will make all-inclusive crowdfunding possible.
Seems like the blockchain technology has a promising future in many industries. Even though many skeptics do not believe that blockchain needs to penetrate some sectors and that it cannot improve their efficiency, many experts think that the future belongs to the blockchain.
One thing is certain now: blockchain has the potential to solve the acute issues of data storage and security, transactions processing and intermediaries, supply chains, intellectual property, government operations, charity, voting, and crowdfunding. Some experts say that the implementation of blockchain in these spheres will have such a dramatic effect as the invention of the Internet once had. People didn’t realize how inefficient they were until technology took them to the next level.
Maria Redka is a Technology Writer and Content Marketing Manager at MLSDev, an award-winning mobile, and web development agency. Maria researches the IT industry and the app development market, writes articles, and curates company content. She is passionate about helping the company customers find out more about software development and about MLSDev expertise.
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